Wednesday, July 9, 2014

Dividends & Covered Calls for Retirees AZN & BMY

Two calls are worth your consideration if you are retired and need income.

Each of these stocks has a long history of not only paying dividends but also routinely increasing the dividend payout.

Neither stock is a bona fide Dividend Machine because their yields are less than 3.5%. By employing covered calls, you could increase your income. If the call buyer takes your stock you also pocket a nice capital gain in addition to the call premium. Should the stock price not increase as the call buyer expects, and you are stuck with it, you still have a nice dividend payer (note that each stock pays more than 3% per year) with the opportunity to sell more calls in the future.Dividends & Covered Calls on AZN & BMY

AstraZeneca's current annual yield is 3.74% with average dividend growth over the past five years of 6.79%. Bristol-Myers Squibb's annual yield is 3.01% with average dividend growth over the past five years of 3.23%.

Consider these two fine stocks for the income producing portion of your portfolio.

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Covered Call Opportunities

Square, symbol SQ, is my current favorite stock that is not a dividend machine. To turn it into an income investment, I use SQ's volatiity to buy when it dips and sell calls. See the table above. Note that this call is not included in the post published on 12/12/18 M*

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TheMoneyMadam's Story

My income investing success came from my experience managing my and other people's money since 1993. Successful income investing requires discipline. In this blog I provide specific investments based on my principles of conservative income investing. I hope to help the thousands or even millions of people who have saved and want to invest their nest eggs to retire with income that grows. M* MoneyMadam

Disclaimer

Information on this blog does not constitute investment advice. Review or mention of any stock, bond, or other investment shall not be considered a buy or sell recommendation. Everything in this blog is the opinion of the author and no warranties are expressed or implied. M*MoneyMadam.